Agenda item

To receive a report by the Head of Legal, HR and Democratic Services (copy attached) presenting key documents required to reach the Final Deal Agreement for the North Wales Growth Deal with the UK Government and Welsh Government.

10.10 – 10.50 a.m.

Agreement on the recommendation was by consensus. No formal vote was taken.  All Committee members indicated they were in favour of the recommendation, no one indicated they were against it and no one indicated that they wished to abstain.  The Committee:

Resolved: - subject to the above observations –

(i)           that, having considered the information provided during the discussion and the documents relating to the Final Growth Deal attached as Appendix 1 to the report, to support and recommend the proposals contained within the documents for submission to Cabinet and Council for formal endorsement and approval; and

(ii)          confirmed that as part of its consideration it had read, understood and taken account of the contents of the Denbighshire County Council Well-being Impact Assessment attached as Appendix 2 to the report.

The Council Leader, Corporate Director:  Economy and Public Realm, Monitoring Officer, Section 151 Officer and the Operations Manager from the North Wales Economic Ambition Board’s Programme Office (OMNWEAB) provided members with detailed background information on the long-term objective of the Growth Deal, developed in partnership between the North Wales Economic Ambition Board (NWEAB) and both Welsh and UK Governments.

Details were provided of the financial implications for all partners, including Denbighshire County Council, and the anticipated long-term benefits of the proposed investment on the county and the region’s economy.  The close alignment between the Skills Strategy for the North Wales region and the Growth Deal should support the delivery of the programmes and projects outlined in the Business Plan and secure the area’s future economic prosperity.  Whilst projects were located in various areas across the region it was anticipated that they would all to a greater or lesser extent benefit the entire region, with some projects benefitting certain areas more than others. However, this would be counterbalanced by other projects benefitting other areas.  Members were advised that in order to progress the Deal to the implementation stage, secure the funding to deliver the projects and realise the anticipated economic benefits all partners were required to agree and sign the Final Deal Agreement, the Overarching Business Plan and the Governance Agreement 2 (GA2) before the end of 2020. The GA2 document provided the governance framework for the agreement which detailed the structures and processes that would be put in place to safeguard all partners and ensure open and transparent monitoring and scrutiny arrangements to safeguard the accountability of decisions taken by the Economic Ambition Board on behalf of all its partner organisations.

Whilst Committee members had concerns about the potential impact the COVID-19 pandemic, along with the uncertainties surrounding BREXIT and any future trade deals would have on the projects which formed part of the proposed Deal as well as the area’s future economic prosperity and resilience, they acknowledged that NWEAB had recognised these risks and were monitoring them.  Members were assured that the governance arrangements outlined in the GA2 document and the Overarching Business Case capped each authority’s annual financial contribution towards the Growth Deal, with safeguards in place that if any additional funding was required it would only be provided following approval via each authority’s democratic processes.

The Council Leader, Corporate Director:  Economy and Public Realm, Monitoring Officer, Section 151 Officer and the OMNWEAB answered members’ questions in relation to various aspects of the Board’s work to date, the Growth Deal and associated Business Plan and long-term objectives, and the Governance Arrangements, including future scrutiny of the Board and the Growth Deal. The following were discussed in more detail:

·         Commitment had been provided from both Welsh and UK Governments to invest in businesses to grow and move forward, regionally and locally. Through the Covid-19 Pandemic the authority and the private sector had shown to be flexible and robust to overcome hurdles and concerns.

·         It was noted that with Capital projects there would always be the risk of an overspend. The Lead Member confirmed that it would be a Board decision to support the overspend on projects. The maximum spend would be a cash amount of £240 million. The Head of Finance and Property Services stated the potential for overspending would potentially be seen in the big builds such as colleges. The regional projects would be more straight forward and remain within budget. The programme office had responsibility to monitor the projects. Emphasis was given that the Authority had a cap of £90K contribution, if that had to be reviewed it would have to be presented back to local authority for agreement.

·         Confirmation was provided that the lead sponsor was a reference to the lead sponsor to any individual project. The accountable body was very tightly controlled and defined. Gwynedd Council, as the Accountable Body, would receive the money from Government on behalf of the region and administer the money to the given projects. 

·         The OMNWEAB informed members of the four main projects aimed at addressing broadband needs. One of those projects would focus on the more rural issues associated with broadband connectivity.  It was emphasised the vital need for good broadband connection. Members were reminded of the regional digital strategy which incorporated alternative funding mechanisms.

·         The Corporate Director: Economy and Public Realm noted that one potential risk may be related to the financial contribution aspect. Some of the projects proposed for Denbighshire may not be fulfilled as proposed due to unforeseen circumstances or situations but as an authority the Council would be obliged to contribute financially. Overall it was emphasised that improvements regionally would filter down to each local economy. Confirmation was given that robust governance arrangements were in place to minimise risk. The OMNWEAB highlighted the impact of Covid-19 on the private sector. Securing the level of investment from the private sector, to maximise the impact of the growth deal and benefits to the region would be seen as a potential risk. It was stressed that officers felt the benefits to the Growth bid outweighed the risks.

·         The sites that had been identified within the report for housing related sites that could attract funding through the land and property programme were mostly sites that are already been allocated for development within the Local Development Plan (LDP). Confirmation was provided that sites had elements of planning permissions or applications started. The funding package for housing was to aid the development of sites previously agreed to develop. It was hopeful that the projects would encourage people to live and work in the authority and benefit the economy.

·         The report had included the minimum base line for investment. Work to gain further private sector investment was on going.

·         The proposal would be presented to Cabinet and Council for approval of the overarching business plan, which sets out the strategy of how the growth plan would be implemented. The individual project business cases within the programmes would be for approval by the Joint Committee of the North Wales Economic Ambitious Board. If a change to the overarching business plan was required, it would have to be presented to and agreed by each of the Local Authorities and partners.

The Head of Legal, HR and Democratic Services explained that two provisions were in place for a partners to exit the agreement. The first being the provision of 12 months written notice of withdrawal following the lock in period of 6 years. The other method would be by notification of termination. This would be done following a default notice setting out methods to amend any discrepancies to obligations not fulfilled. Any partner leaving the agreement would be issued a liability report and be responsible for the costs to which they were already committed as well as the costs incurred as a consequence of their withdrawal or termination.

Having considered the documentation and information provided the Committee was satisfied and assured that the GA2 agreement would provide a robust framework for governance and accountability, risk management, performance and quality monitoring, and scrutiny arrangements, supporting the delivery of the Deal’s objectives for Denbighshire and the region. Members were of the view that the Growth Deal provided an excellent opportunity for the region to realise its economic potential, but emphasised the need, once the Growth Deal Agreement had been approved and secured, for the NEWAB to link its work into that of other high profile programmes, such as the Northern Powerhouse, in order to try and maximise the benefit to the region from the projects and the investment made.

Following a detailed and an in-depth discussion the Committee:  

Resolved: - subject to the above observations –

(i)           that, having considered the information provided during the discussion and the documents relating to the Final Growth Deal attached as Appendix 1 to the report, to support and recommend the proposals contained within the documents for submission to Cabinet and Council for formal endorsement and approval; and

(ii)          confirmed that as part of its consideration it had read, understood and taken account of the contents of the Denbighshire County Council Well-being Impact Assessment attached as Appendix 2 to the report.